Other Briefings
Fuel Prices Attack Hospitality Industry Too
July 18 – Hotel room rates in New Delhi have dropped almost 50 percent the lowest in two years on the back of rising aviation fuel fees and an economic slowdown, the Times of India reported
"Corporates have cut travel of their executives which has affected our occupancy. Although the tariff is in the range of Rs 5,000-Rs 8,000 (US$117-187) in five-stars, they are still pretty affordable. But with airfares being where they are, personal leisure travel is becoming out of reach of the middle class," said an leading hotelier.
India’s Communist Party Ends Coalition Support
July 10- India’s Communist Party formally ended its support of the Congress-led coalition, over a government decision to push through with a civilian nuclear deal with the United States.
Leftist parties argue that the deal could threaten Indian sovereignty while the government feels the deal is needed to answer the country’s increasing energy demands.
Prime Minister Manmohan Singh's said in a statement that the government will go ahead with seeking approval from the International Atomic Energy Agency for the U.S. civilian nuclear deal.
India’s Nuclear Deal Nears Completion
July 8 – Having garnered strength from his fragmented coalition government, India's confident prime minister, Manmohan Singh, is ready to meet President Bush on Wednesday morning, the stage is now set for India to sign the nuclear deal with America.
India Creates 30,000 American Jobs
July 7 – Amidst the row in the United States over outsourcing, a study proves that Indian companies are not taking American jobs, instead they have generated more than 30,000 jobs for U.S. citizens in recent years. Indian small and medium enterprises alone in 2007 had set up shop in the U.S. through greenfield units or via acquisitions and created no less than 65,000 jobs, said a study conducted by industry chamber Ficci.
India’s Nuclear Deal Flares Up
July 2 – There are always two sides to the coin and India's ruling coalition congress party is facing off against their leftist counterparts. While the Congress party claims the nuclear deal with America will put an end to India's energy problems, the left is convinced its a bid to sell India to the U.S. and have threatened to pull out their support from the ruling coalition government.
The following are key events and meetings planned this week that could decide the fate of the government, as compiled by Reuters.
Thursday, July 3: The Communist Party of India (CPI), an ally of the ruling coalition and India's second largest left party, holds its secretariat meeting. The nuclear deal will figure prominently as the party has been very critical of the government.
Thursday, July 3: The United National Progressive Alliance (UNPA), a coalition of smaller parties, holds a meeting to decide their final stand on the nuclear deal.
Interest Rate Rises to 8.5 Percent
June 25 – The Reserve bank of India raised interest rates for the second time this month and asked lenders to set aside more money as reserves to cool inflation running at a 13- year high.
The repurchase rate was lifted to 8.5 percent from 8 percent, and the cash reserve ratio to 8.75 percent from 8.25 percent, India's central bank said. The increase was the biggest since 2000 and followed a quarter-point rise on June 11.
Governor Yaga Venugopal Reddy is under pressure from the finance ministry to tighten monetary policy after record oil prices drove inflation to 11.05 percent in the week ended June 7. That may further hurt consumer demand and threatens to derail India's record 8.8 percent annual economic growth since 2003, the fastest after China among the world's major economies, Bloomberg reported.
Bollywood Weds Hollywood
June 20 – BOLLYWOOD'S songs are hummed in Morocco, its films are rented in California and its stars are cast in wax at Madame Tussauds in London. But India's new money has an appeal even its melodrama cannot match. On June 17th the Wall Street Journal reported that one of India's biggest conglomerates, Anil Ambani's Reliance group, was in talks to form a film-making partnership with Steven Spielberg's DreamWorks studio, owned by Viacom, a media giant. Mr Spielberg and David Geffen, the studio's co-founders, want to regain their independence when their contract with Viacom ends, and are looking for funding.
India’s Roadmap to be 40 times bigger by 2050
June 17 – Goldman Sachs authors of the famed BRIC's report of 2004, which outlined the emergence and dominace of Brazil, Russia, India and China by 2050, has recently published a 10 point roadmap for the Asian subcontinent. The roadmap points out India's flaws and how the country can make constructive changes to emerge as the second largest economy next only to China's by 2050 when it would have a gross domestic product of $40 trillion.
Written by Jim O'Neill, chief economist at Goldman, and Tushar Poddar of the Asia Economic Research team, the report indicates that India needs to improve its governance, control inflation, introduce credible fiscal policy, liberalise financial Markets and increase trade with its neighbours. It also needs both to significantly raise its basic educational standards, and increase the quality and quantity of its universities. The country needs to boost agricultural productivity, improve its infrastructure and environmental quality.
to read the entire report click here.
